The Trump administration is investing $5 billion to launch the "AI + Research" plan, with drug research and advanced materials at the forefront of policy opportunities.

The Trump administration announced on Wednesday that it will invest $5 billion to launch a large-scale artificial intelligence research program, using AI to tackle the root causes of chronic diseases, accelerate drug development, and develop more durable building materials and other long-standing scientific challenges. This program involves 15 federal agencies including the Department of Health and Human Services, Department of Energy, Department of Transportation, Department of Defense, and Department of the Interior, marking the most thorough reform of the U.S. federal research system in nearly 80 years. White House Chief Technology Advisor Michael Kratsios stated in an interview that scientists will be able to use the supercomputers, artificial intelligence, specialized datasets, and other components required for algorithm experiments from the U.S. Energy Corp. Department. Microsoft Corporation also announced on the same day that it will donate $40 million worth of AI computing resources over three years to support this program. The $5 billion plan behind a $200 billion scientific research map reconstruction This $5 billion plan is not an isolated action, but a core part of the Trump administration's reshaping of the federal research system. A new report and memorandum released on Tuesday by the White House Office of Science and Technology Policy (OSTP) show that these directives will affect the direction of the federal government's annual approximately $200 billion research and development budget allocation for the remaining time of Trump's second term. The new guidelines will fundamentally change the decades-long research funding model. The White House explicitly stated in the report that the government hopes to prioritize projects that provide opportunities for individuals rather than focusing directly on universities, such as scholarships and various research awards. The Trump administration believes that spending too much time on bureaucratic matters in government agencies and universities is a key hindrance to American development. According to the plan, individual researchers in universities will directly receive funds, reducing the direct involvement of universities as middlemen. Kratsios bluntly stated in an interview, "Over the past two or three decades, we have become very rigid in terms of research funding, always thinking that the same research should be funded in the same way in the same institutions." He said that on Tuesday he met with the head of an Ivy League university about this new research funding approach and received a positive response. "Guangdong Create Century Intelligent Equipment Group Corporation Plan": Mobilizing the entire industrial chain like the AI version of the Manhattan Project This $5 billion plan is a continuation of the "Guangdong Create Century Intelligent Equipment Group Corporation Mission" launched by the Trump administration earlier. This plan, referred to as the "AI version of the Manhattan Project" by the White House, aims to "use artificial intelligence to revolutionize the way scientific research is conducted and accelerate the process of scientific discoveries." The "Guangdong Create Century Intelligent Equipment Group Corporation Plan" was launched in December 2025 and has enlisted 24 top technology companies including Microsoft Corporation, Alphabet Inc. Class C, NVIDIA Corporation, OpenAI, and Amazon.com, Inc. Cloud Services (AWS) to participate in cooperation. This collaboration lineup covers the entire chain from chip design, computing power supply to AI model development. The U.S. Energy Corp. Department has integrated these companies' cutting-edge AI models and supercomputing power into the national laboratory system. On the international cooperation front, Japan has become the first international partner in this plan. On June 4, 2026, the U.S. Energy Corp. Department, the Ministry of Education, Culture, Sports, Science, and Technology, and the Ministry of Economy, Trade, and Industry of Japan established a strategic partnership totaling $1 billion, with each party contributing $500 million over the next five years. The two sides will form 11 joint scientific teams, integrating resources from 12 national laboratories under the U.S. Energy Corp. Department and 12 major research institutions in Japan, focusing on research in quantum information science, fusion energy, biotechnology, advanced materials, particle physics, and autonomous laboratory systems. The joint research teams will have access to the high-performance computing systems of the U.S. Energy Corp. Department as well as Japan's "Fugaku" supercomputer. The U.S. government has also set more ambitious national goals recently, including deploying a powerful quantum computer by 2028 and starting the construction of 10 new large nuclear reactors by 2030 to enhance electricity supply capacity. New rules of "political responsibility": the struggle for control of research funds approval The White House report written by Kratsios clearly states that "federal government support for science must be politically responsible." This statement suggests a fundamental change in the approval mechanism for research funding. A new regulation proposed by the White House Office of Management and Budget would give political appointees greater power in approving research funding and aligning research directions with government policy priorities. This move has sparked strong opposition from the scientific community. Critics warn that AI models themselves are prone to errors and placing too much emphasis on this technology may limit the types of research that researchers engage in. Democrats in Congress have made clear their opposition to this. Representative Debbie Dingell introduced a resolution warning that the proposal would "inject politics into the federal research funding process and weaken the long-standing peer review system." Senators Sheldon Whitehouse and Jack Reed jointly wrote to the White House Office of Management and Budget, strongly opposing the plan to "politicize federal funding," calling it "beyond the authority of the OMB." This controversy is not new. In May of this year, the Trump administration took action to give political appointees greater control over the allocation of billions of dollars in research funding to federal agencies, leading scientists to warn that this move would place "critical research funding in the hands of partisan figures lacking relevant expertise." A federal court had previously rejected the Trump administration's attempt to cut federal funding provided by the National Institutes of Health to universities, with an appeals panel ruling in January that the government had no authority to unilaterally cut such funding. Potential market impact Industry layout: A comprehensive bet from AI equity to computing power infrastructure The Trump administration's AI strategy is now extending from the research end to the industry end. In addition to the "Guangdong Create Century Intelligent Equipment Group Corporation Plan," the government is pushing forward AI industry development in multiple dimensions: AI mass ownership concept: Trump stated last month that he is exploring ways to allow American taxpayers to hold shares in leading AI companies, calling it a possible "beautiful thing" that would make the public "partners in this revolution." OpenAI has reportedly proposed to the government to transfer 5% of its equity. Computing power energy security: AI giants like Alphabet Inc. Class C (GOOGL.US), Microsoft Corporation (MSFT.US), OpenAI, have pledged to pay for data center electricity costs out of their own pockets to avoid raising electricity prices for American households. The largest public utility companies and data center developers have signed commitments from the Trump administration to pay higher costs for the energy needed to run large language models. Export plan facing setbacks: However, the "U.S. AI Export Plan" aimed at promoting the global export of American AI technology received only 78 applications in its first round, showing a difficult start. AI infrastructure and research services sector long-term benefits The announcement of the Trump administration's $5 billion AI research plan has the potential to benefit several capital market sectors. AI computing power infrastructure: The "Guangdong Create Century Intelligent Equipment Group Corporation Plan's" continuous demand for supercomputers and AI chips directly benefits chip manufacturers like NVIDIA Corporation (NVDA.US), AMD (AMD.US). The deep involvement of 24 tech giants also implies that cloud computing platforms like AWS, Microsoft Corporation Azure, Alphabet Inc. Class C Cloud, and others will continue to receive government computing orders. Research software and services: The shift in funding models towards individual scientists may spur the emergence of research management, AI modeling, and data analysis tools and services providers tailored to independent researchers. Quantum computing and frontier technologies: The goal of deploying a quantum computer before 2028 provides policy support for companies like IonQ (IONQ.US), Rigetti Computing (RGTI.US), and other quantum computing concept stocks. Biotechnology and materials science: The $5 billion plan focuses on areas such as chronic diseases, drug development, and building materials, giving hope for government contracts and funding to biotechnology and advanced materials companies. However, the fundamental change in the research funding allocation mechanism also brings uncertainty. Universities and research institutions may face the risk of reduced federal funding, and the involvement of political appointees in research fund approval may change market expectations for research directions.